A Quick Reminder to Swedish Workers

Apparently Swedish unions are demanding a looser monetary policy

Forget Chuck Schumer's cat-out-of-the-bag 'get back to work' comments to Bernanke, now it is union-leaders who are advising the world's central bankers. "There is a not a single reason not to lower rates" exclaims Sweden's trade union confederation to the central bank as he begins negotiations with employers on wage deals for next year. His demands (for lower rates) are "far from excessive" and he adds "should not cause inflation" as Swedish organized labor have "never called for levels that ... could not be supported economically."

Inflation and monetary debasement have always been Progressive favorites -- until, of course, they were not.  Consider the plight of the worker in Weimar Germany

By mid-1923 workers were being paid as often as three times a day. Their wives would meet them, take the money and rush to the shops to exchange it for goods. However, by this time, more and more often, shops were empty. Storekeepers could not obtain goods or could not do business fast enough to protect their cash receipts. Farmers refused to bring produce into the city in return for worthless paper. Food riots broke out. Parties of workers marched into the countryside to dig up vegetables and to loot the farms. Businesses started to close down and unemployment suddenly soared. The economy was collapsing.

It was total hell.  If a worker's family member could not find something to buy in the morning with the worker's morning pay packet, the money was worthless by dinner time.  Not to mention the incredible lost productivity of all those man-hours spent running around trying to find goods on shelves (of which we got a small taste post-Sandy, as people spent hundreds of dollars of their own time waiting in queues because the government would not let gas station owners charge them an extra $20 for scarce gasoline).

  • MingoV

    "There is not a single reason not to lower rates"

    Most of the union workers are borrowers rather than savers. What they really are saying is: "We demand cheaper mortgages and car loans. Retirees' savings will not grow, but we don't care about that."

  • Guest

    Unions (at least in the US) frequently negotiate fairly strong CoLAs into their salary and pension contracts.

  • Me

    Slippery Slope Fallacy.

  • John David Galt

    Since September 2008 the supply of dollars has already been increased by almost $2T (roughly 35-40%). The only reasons this huge inflation has not yet shown up in price hikes is that all the "stimulus" spending has prolonged the depression, and his banking overregulation is keeping credit scarce, both just as after 1929.

    If history repeats itself, and I believe it will, the next things we'll see are President Obama seeking a constitutional amendment to give himself more terms, or declaring an emergency to take more powers for himself, or both.

    The plain fact is that President Obama hates for anyone in America to be well off except himself and his buddies, so he's deliberately turning our economy into 1970s Argentina. His speeches to his friends admit this. So don't be surprised if he behaves like other dictators of banana republics in other ways.

  • http://devilish-details.blogspot.com/ mesaeconoguy

    “Consider the plight of the worker in Weimar Germany…”

    Yes, but it was a boon to wheelbarrow manufacturers.

    Signed,

    Paul Krugman

  • http://devilish-details.blogspot.com/ mesaeconoguy

    How so? Please, do elaborate....

  • http://devilish-details.blogspot.com/ mesaeconoguy

    Partially, but correct sentiment.

    What they’re actually demanding is free shit at everyone else’s expense, which is what government does, more so now that Corporatist/NeoSocialist 2 has been reelected.

  • perlhaqr

    It just seems weird though, since ultimately, inflationary policy like that benefits those evil 1%ers more than everyone else, since they're the folks that the inflationary cash gets distributed through.

  • mesocyclone

    When I was a kid, I had German stamps in my collection with 1 billion mark overstrikes on them. For a first class postage stamp!

  • Xmas

    I don't think they can do anything like that anyway. I believe Swedish Krona are tied to a specific exchange rate range against the euro by treaty. I don't think they can get away with any sort of monetary loosening beyond what's already happening with t he euro.

  • Xmas

    Oops, I'm wrong. Danish krone are tied to the euro. The Swedes are free to do whatever they want at the moment.

  • Harry

    Test to see if this works.